Case Summary

• The Zinnia hotel, located in Minneapolis, MN
• 300 Rooms and 167 employers
• Current contract expiring, Management and Local H-56 Union bargained on December 8th, 2016.
• Assumptions agreed upon prior to bargaining
• The new contract will last until hotel is under new ownership

Laws/Regulations/ Agencies

• State minimum wage law
• Affordable Care Act
• Employee Retirement Income Security Act
• Title VII of the Civil Rights Act of 1964
• Family and Medical Leave Act
• Fair Labor Standards Act
• Human Services Licensing Act
• Maltreatment of Minors Act
• WARN ACT

Management's Position

• The Zinnia will be negotiating other contracts next year
• Reputation
• The owner Ms. Baldercash pressure not to increase labor cost

Employee's/ Union Position

• Rank and File demands
• Union feels like all employees are overworked, underpaid, underinsured
• Employee's unhappy with ownership and picket outside her house

Contract Results

• Healthcare: $2.90 contribution by employer per year
• Wage Increase:
• Year 1: 3.5%
• Year 2: 2.5%
• Year 3: 2.5%

Contract Results

Pension Contribution

• Year 1: .45 cents
• Year 2: .50 cents
• Year 3: .50 cents

Vacation

• 5 weeks of paid time off upon completion of voluntary cross-training program

Contract Results

Work Schedules

• 2 Week Notice

Notification

• 2 months required for warning shut down

Meetings

• 10 minute mandatory meeting at beginning of each shift including management and union representative.

Meals

• 50% discount on food covered by the company for employees

Contract Results

Holidays

• Employees have an option to take six "floating" holidays off

Daycare

• Company is covering 100% renovation costs and 50% of childcare costs

Discussion/ Conclusion

• Substantial compromises beyond BATNA
• Management gave too many vacation days, more money towards 401K Contribition
• Management received cross- training proposal
• Union settled too quickly and for too little wages and did not receive double time for holidays
• Solid compromise on: Healthcare, Daycare, Work Schedules, Meetings Notifications, and Meals.
• Financial Costs after changes over 3 years: $53,504,818.69
• Net Income of 3 year contract: $2,528,530.03